Strategic management

Strategic ManagementCOMPANY Analysis Assignment on

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PRERNA AGRAWAL ARAVIND DEVANSHU TIWARI KRISHNA BHASKAR SAMRAT

SUBMITTED FOR PARTIAL FULFILMENT OF MBA 2010-2012 ALLIANCE BUSINESS SCHOOL, BANGALORE

Introduction:
ITC is one of India's foremost private sector companies with a market capitalization of over US $ 22 billion and a turnover of US $ 6 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week. ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, AgriBusiness, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery. As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman YC Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC's wholly owned Information Technology subsidiary, ITC Infotech India Ltd, provides IT services and solutions to leading global customers. ITC Infotech has carved a niche for itself by
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addressing customer challenges through innovative IT solutions. ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating. ITC employs over 26,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 3,53,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value for the nation For the Shareholder."

Organization Analysis:
Vision: Sustain ITC's position as one of India's most valuable corporations through world class performance, creating growing value for the Indian economy and the Companys stakeholders Mission: To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering superior and sustainable stakeholder value Objectives: The primary focus of ITC's Social Development Initiatives is to create sustainable sources of farm and off-farm livelihoods and to improve the social infrastructure especially in areas where it impacts women and children. In pursuit of these objectives, the following goals have been set for the next five years:

Web-enable 10 million farmers through 20,000 e-Choupals in 100,000 villages. Bring at least 50,000 hectares under soil and moisture conservation practices. Transform at least 1,00,000 hectares of wastelands into productive and revenuegenerating assets for the poor. Create at least 10,000 women entrepreneurs with a sustainable source of supplementary incomes. Improve the genetic stock of at least 150,000 cattle through artificial insemination practices. Provide supplementary education support services to at least 100,000 children.

In its Endeavour to preserve India's cultural and artistic heritage, ITC will also continue to ensure that its initiatives in the areas of preservation and promotion of Indian music, art and theatre are strengthened. Goals: Poverty: To halve by 2015 the proportion of the worlds people whose income is less than $1/day. Hunger:
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To halve by 2015 the proportion of the worlds people who suffer from hunger. Universal Primary Education : To ensure that, by 2015, children everywhere will be able to complete a full course of primary schooling. Gender Equality : Progress towards gender equality and the empowerment of women should be demonstrated by ensuring that girls and boys have equal access to primary and secondary education. Environmental Sustainability: To stop the unsustainable exploitation of natural resources and to halve, by 2015 the proportion of people who are unable to reach or to afford safe drinking water. Sustaining ITCs position as one of Indias most valuable corporations Achieving leadership in each of the business segments within a reasonable time frame

Strategic Analysis of the company:

In all businesses today, aligning human resource management with business strategy has become an important element to succeed. And ITC is no different. Organizational restructuring, managing key resource requirements, performance management systems, career and succession planning have all been re-aligned to form synergy with the companys overall business strategy. Organizational Structure:

Strategic strategy:

management

and

organization

structure/structure

follows

Once the mission,vision, goals,objectives,strategies,values and programmes are defined for an organization. the manager has to implement and execute the chosen strategy by developing the organizational capabilities to reach the target objectives on schedule Strategy execution on strategy implementation is an action oriented process which aims to achieve competencies and capabilities for an effective organization As firms grow, their structure generally changes from single to complex structure for eg-small firms are functionally structured. As they grow in size and are medium sized they lend to be divisionally structured whereas large organizations are matrix structured There are many internal and external factors that affects the organization structure. However the basic aim of organization structure is to facilitate corporate objectives effectively and efficiently. There are four types of organization structure and they are as follows-

The functional strategy: This is the simplest and least expensive structure.in this the activities are grouped by the business functions such as marketing, finance,HR,operations,etc.it promotes specialization and encourages perfection at a given task.quick decisions making is possible. However the big disadvantage is that it allows for top down approach and puts

lot of pressure on the top management to perform.the functional structure can be diagrammatically represented as follows:The divisional structureAs the small business grows it has more difficulty in managing different functions in different geographical markets. This requires a structure that controls operations, competes successfully in various locations this kind of structure is called as divisional structure. A banks divisional structure can be shown on the following basis: Geographic area North zone, east zone, west zone and south zone Products and services Corporate finance consumer finance

Customer Retail segment,HNI,NRI segment etc..HNI(high networth individuals)

Strategic business unit(subs)structure As the business grows in size and diversity organizational control and evaluation becomes more difficultThe span of control becomes too large and thus increase in revenue need not be an increase in profits In order to define a profit center, a sbu is needed.sbu groups similar division into unique and delegates authority and responsibility for each unit to a single executive and directly reports to a CEO This increases co-ordination and communication leading to increased profitability and overall efficiency The SBU structure of ITC is as follows-

Matrix structure: This is the most complex of all design as it depends on both ways i.e. authority and communication. Traditionally on functional and divisional organizational structure depends on suthority, responsibility, and communication with a top down approach In a matrix structure there are dual times budgetary, authority and control. This kind of system is not prevalent in the existing Indian corporate sector but is very popular in USA by organizations heading new products new markets and latest technologies.

The disadvantages of this structure are that it is very complex, costly and requires more management position.

At the top are Chairman and Board of Directors, who are responsible for the strategic supervision of ITC, its wholly owned subsidiaries and their wholly owned subsidiaries. The ITC board is a balanced board comprising Executive and Non-Executive Directors. The Board ensures that the Company has clear goals relating to shareholder value and its growth. It sets strategic goals and seeks accountability for their fulfillment. There are four board committees, namely, the Audit Committee, the Nominations Committee, the Compensation Committee and the Investor Services Committee. At the second level is the Corporate Management Committee, which is responsible for the strategic management of the company's businesses within Board-approved direction/framework. It comprises all the Executive Directors and three or four key senior members of management. Third level consists of divisional CEOs of each business assisted by their own divisional management committees. Corporate Functions of the Executive Management Team includes Planning and Treasury, Accounting, Legal, Secretarial, Human Resources, Communications, Internal Audit and Information Technology. With mundane tasks of everyday executive management being delegated the management remains focused on issues of immediate importance; The Executive management of the individual businesses that are free of handling strategic management responsibilities of ITC as a whole is then able to channelize their energies and time in enhancing the effectiveness and overall growth of their individual units. Corporate Governance as defined by ITC is a systemic process by which companies are directed and controlled to enhance their wealth-generating capacity. A company employs vast sums of societal resources during this process of wealth generation. ITC is of the firm belief that the governance process being followed should ensure that these resources are used optimally to meet the aspirations of its stakeholders and society. This is further reflected
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in the deep commitment of the company to contribute to the Triple Bottom Line, which is the development of the nations economic, ecological and social resources. Overall, the structure of ITC has high complexity because of horizontal differentiation within the organization. The most visible evidence is that of specialization and departmentation. Complexity also increases because of spatial differentiation. The ITC Code of Conduct, as adopted by the Board of Directors, is applicable to all Directors, senior management and employees of the Company. This Code is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct. The Code covers ITC's commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly workplace, transparency and audit ability, legal compliance, and the philosophy of leading by personal example. Since nonadherence to the code is brought to the attention of the immediate reporting authority, formalization is also there in ITC.

LEVELS OF STRATEGIC MANAGEMENT

The strategic can be broadly divided into three levels they are as follows 1. Corporate strategy
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2. Business strategy 3. Functional strategy The above three levels can be diagrametically rapresent are as follows,

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The above levels of management is explain as follows.. CEO, MD CORPORATE STRATEGY:[CEO,MD] Corporate 1. It describe the companies over all direction in terms of its general attitude towards growth and the management of its various businesses and the product line. 2. Corporate strategy refers to the principle strategy of the diversified firm. HOD 3. It is also concerned with Business of businesses. selection strategy 4. It is also called as highest level of strategy SUPERVISORS, ITCs corporate strategies are : WORKERS, EMPOYEES
a) ITC is a board-managed professional company, committed to creating enduring Functional strategy value for the shareholder and for the nation. It has a rich organisational culture

rooted in its core values of respect for people and belief in empowerment. Its philosophy of all-round value creation is backed by strong corporate governance policies and systems.
b) Create multiple drivers of growth by developing a portfolio of world class

businesses that best matches organisational capability with opportunities in domestic and export markets. c) Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards & Packaging, Agri Business and Information Technology.
d) Benchmark the health of each business comprehensively across the criteria of

Market Standing, Profitability and Internal Vitality. e) Ensure that each of its businesses is world class and internationally competitive.
f) Enhance the competitive power of the portfolio through synergies derived by

blending the diverse skills and capabilities residing in ITCs various businesses.
g) Create distributed leadership within the organisation by nurturing talented and

focused top management teams for each of the businesses.

h) Continuously strengthen and refine Corporate Governance processes and systems

to catalyse the entrepreneurial energies of management by striking the golden balance between executive freedom and the need for effective control and accountability.

Business strategy:[HOD]

1. It is usually occurs at the strategic business unit level or product levels. 2. It emphasis improvement of the competitive position of a firms product or services in a specified industry

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3. Business strategy includes mktg strategy`s, H.R strategy`s, financial strategy`s,

legal strategy`s and information technology development strategies. 4. This level is based on short and medium term plan and each department functional responsibilities. BOSTON CONSULTING GROUP (BCG) MATRIX is developed by BRUCE HENDERSON of the BOSTON CONSULTING GROUP IN THE EARLY 1970s. According to this technique, businesses or products are classified as low or high performers depending upon their market growth rate and relative market share. THE BCG GROWTH-SHARE MATRIX It is a portfolio planning model which is based on the observation that a companys business units can be classified in to four categories: a) b) c) d) Stars Question marks Cash cows Dogs

It is based on the combination of market growth and market share relative to the next best competitor.

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Market attractiveness & Competitive strength is also important

Limitations Assumes market growth rate. A firm may grow the market. A Dog may be helping other products. High market share/Growth is not the only success factor. Linkage between market share and profitability is questionable

STARS-High growth, High market share

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Stars are leaders in business. They also require heavy investment,

to maintain its large market share.

It leads to large amount of cash consumption and cash generation. Attempts should be made to hold the market share otherwise the star will become a CASH COW.

CASH COWS-Low growth , High market share They are foundation of the company and often the stars of yesterday. They generate more cash than required. They extract the profits by investing as little cash as possible They are located in an industry that is mature, not growing or declining.

DOGS-Low growth, Low market share Dogs are the cash traps. Dogs do not have potential to bring in much cash. Number of dogs in the company should be minimized. Business is situated at a declining stage. QUESTION MARKS-High growth , Low market share Most businesses start of as question marks. They will absorb great amounts of cash if the market share remains unchanged, (low). Why question marks? Question marks have potential to become star and eventually cash cow but can also become a dog. Investments should be high for question marks.

FUTURE BUSINESS STRATEGY OF ITC ARE

No new investments in cigarrates New ventures in agri business Use the distribution network to reach rural areas Tie ups and acquisitions to boost IT business Increased exports Cut down prices in the biscuit domain Introduce low fat chips in respect of ITC foods
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Hr strategies Employee training Self-managing teams Pay for performance

FUNCTIONAL STRATEGY:[SUPERVISORS,WORKERS,STAFFS] 1. It relates to the functional areas such as production, mktg, financing, personal,

etc. 2. The functional strategy aims at achieving functional objectives. 3. This level is also called as operation strategy level or departmental strategy level. 4. It is lowest level of strategy management. It is deal with day to day operation level of the business. The functional strategies of ITC areMarketing and efficiency in respect of Promotion Advertising Pricing Distribution Product design

Production and efficiency in respect of Economies of scale Flexible manufacturing

This strategy were encouraged by PETER DRUCKER in his theory of Management By Objectives(MBO)

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Strategic management process

1) strategic management is the systematic approach to a major and increasing important responsibility of general management to position and relate the firm to its environment in a away which will assure its continue success and make it secure from surprises

2) Strategic management is a stream of decision and actions which lead to the development of an effective strategy or strategies to help achieve corporate objectives .

Thus strategic management process is the way in which strategies determine objectives and make strategy decisions

3) The strategic management process can be broadly divided into 3phases each phases consists of number of steps these phases are as follows

Phases 1) strategy formulation -

Strategy formulation can also be called as strategic planning .

A strategic formulation is done at the top management level at the top management level or at the top management level or at the co-operate level stage with the levels of strategic management .

Example- At the top are Chairman and Board of Directors, who are responsible for the strategic supervision of ITC, its wholly owned subsidiaries and their wholly owned subsidiaries. The ITC board is a balanced board comprising Executive and Non-Executive Directors. The Board ensures that the Company has clear goals relating to shareholder value and its growth.
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It sets strategic goals and seeks accountability for their fulfillment. There are four board committees, namely, the Audit Committee, the Nominations Committee, the Compensation Committee and the Investor Services Committee.

The strategic formulation phase evolves the following steps

Step 1 framing mission and objectives EgMission: To enhance the wealth generating capability of the enterprise in a globalising environment, delivering superior and sustainable stakeholder value Objective

Web-enable 10 million farmers through 20,000 e-Choupals in 100,000 villages. Bring at least 50,000 hectares under soil and moisture conservation practices.

Step 2 analysis of internal environment After setting the objective or goals the analysis of internal environment may be done the internal environment refers to the study of men power machines method procedure of the organization that is it reveals strength and weakness of the organization The internal environment

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All factors that are internal to the organization are known as the 'internal environment'. They are generally audited by applying the 'Five Ms' which are Men, Money, Machinery, Materials and Markets. The internal environment is as important for managing change as the external. As marketers we call the process of managing internal change 'internal marketing.'

Men: ITC employs over 25,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 3, 53,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations.

Money: ITC is one of India's foremost private sector companies with a market capitalization of nearly US $ 14 billion and a turnover of over US $ 5 billion. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade).

Machinery: ITC is using world class machinery so that they can match with demand of the market. Their most of the facilities are fully automated.

Materials: ITC is using quality raw material so that they can give world class quality product to their customers. They are very selective while selecting supplier for them.

Markets: Its businesses and brands are focused almost entirely on the Indian markets, and despite being most well-known for its tobacco brands such as Gold Flake, the business is now diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market sectors including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery.

Step 3 analysis of external environment .

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The external environment refers to study of government competition consumer technology development affecting the organization that is it reveals opportunity and threats of the organization. Customers ,Competitors ,Market trends ,Suppliers ,Partners technology ,Economic environment Example,Social changes ,New

Supplier: Raw materials, intermediates and the final product sourcing/distribution in widespread across the country. Few items have more than 1 supplier for the raw material e.g. filter rods can be sourced from Mumbai, Bangalore or Devas in MP. Huge supply-demand network for cigarette business, which must operate in the cost optimal way to maximize the profits. Few segments are particular to factories e.g. Kingsize.

Consumer: Organisations survive on the basis of meeting the needs, wants and providing benefits for their customers. Failure to do so will result in a failed business strategy. Its businesses and brands are focused almost entirely on the Indian markets, and despite being most well-known for its tobacco brands such as Gold Flake, the business is now diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market sectors.

The macro-environment

This includes all factors that can influence and organization, but that are out of their direct control. A company does not generally influence any laws (although it is accepted that they could lobby or be part of a trade organization). It is continuously changing, and the company needs to be flexible to adapt. There may be aggressive competition and rivalry in a market. Globalization means that there is always the threat of substitute products and new entrants. The wider environment is also ever changing, and the marketer needs to compensate for changes in culture, politics, economics and technology.

Economic Factors: Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. India has been one of the best performers in the world economy in recent years, but rapidly rising inflation and the complexities of running the worlds biggest democracy are proving challenging.

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Indias economy has been one of the stars of global economics in recent years, growing 9.2% in 2007 and 9.6% in 2006. Growth had been supported by markets reforms, huge inflows of FDI, rising foreign exchange reserves, both an IT and real estate boom, and a flourishing capital market.

Socio-Cultural Factors: The social and cultural influences on business vary from country to country. It is very important that such factors are considered Envisioning a larger societal purpose has always been a hallmark of ITC. Following are the factor which should be kept in mind while doing business in india: 1. India, being a multi-cultural and multi-religious society, celebrates holidays and festivals of various religions 2. India is one of the most religiously diverse nations in the world, with some of the most deeply religious societies and cultures. Religion still plays a central and definitive role in the life of most of its people.
3. The demographics of India is remarkably diverse. India's population of approximately

1.17 billion people (estimate for July, 2009) consists of approximately one-sixth of the world's population 4. India is a young country with an average age between 23-24 years. As a corporate citizen with enduring relationships in rural India, ITC has a history of collaboration with communities and government institutions to enhance farm productivity and the rural resource base. ITCs commitments in agricultural R&D and knowledge sharing have spanned vital aspects of competitiveness efficient farm practices, soil and water management.

Technology factor: Technology is vital for competitive advantage, and is a major driver of globalization. Technology in India accounts for a substantial part of the country's GDP and export earnings while providing employment to a significant number of its tertiary sector workforce. Technically proficient immigrants from India sought jobs in the western world from the 1950s onwards as India's education system produced more engineers than its industry could absorb. Indias growing stature in the information age enabled it to form close ties with both the United States of America and the European Union

IT plays a very critical role in driving the ITC business strategies. IT is an enabler of the business process to ensure business growth through efficient management of operations in the value chain. IT creates new business process or restructure the current business process to enhance customer service availability ,efficient manufacturing / supply chain operations etc

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Political factors: The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. The Indian polity is increasingly seen by political observers as the problem. When populist political appeals stir the passions of the masses, government institutions appear less capable than ever before of accommodating conflicts in a society mobilized along competing ethnic and religious lines

Budget impact: Among the FMCG stocks Marico and ITC are the biggest

gainers. Marico has added 7.3% to Rs 77. ITC has surged 7% to Rs 212, after no change in excise cuts on cigarettes
Due to Govt new conditions ITC Maurya winning the 'Best eco-friendly hotel

Special Prize' award by the Ministry of Tourism, Government of India.

Step 4 gap analysis

the management also conduct for this purpose the management must compare and analyze its present performance level and the desired future performances level eg- Advertisement for the Aashirvaad atta was found to be ineffective and infrequent and did not attract the target customers especially housewives

Step 5 framing alternative strategy-

After framing mission objectives doing swot analysis is gap analysis the management needs to frame alternative strategies to accomplish objectives of the firm. Eg- ITC came up with an aggressive advertisement to attract the Indian housewives as they are found to be the decision maker in the buying of Atta.

Choice of strategies = The organization cannot implement all the alternatives strategies therefore the company has to be selective in nature. Eg-For increasing the sales of ashirwad aata the company selected the marketing strategy of advertisement through which it increased it sales

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Phase 2 strategic implementation

The strategies are formulated to each and every functional development of the business that is marketing finance , hr, operations ,etc once the strategies are formulated then the next stage is implemented of such strategies the strategies involves the following steps

Step 1 formulation of plans program project

These is a need to frame plans programs and project as strategy by itself does not lead to action that is plans result in different kinds of program that is program lead to formulation of project Eg-LOW CARBON GROWTH STRATEGY ITC made a plan and was the only enterprise in the world of its size to have achieved and sustained three global environmental distinctions

Step2 project implementation

A project passes through various stages before the actual implementation .The various phases include conception phase, definition phase, implementation phase and clean up phase Eg-This plan was effectively carried out as 31% of the energy consumed by ITC was from clean and renewable source such as wind power

Step3 procedural implementation The organisation needs to the aware of the regulatory frame work of the government authorities before implementing strategies. The government (regulatory) frame work that needs to be checked out may be such as form regulations, foreign collaboration procedure foreign trade regulation etc Eg-This strategy was implemented to contribute to the goals of national action plan on climate change

Step4 : resources allocation It deals with the arrangement and commitment of different types of resources of various activities so as to achieve the goals of the organization

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Eg-ITCs agri-business with its deep rural linkages is well poised as a supply chain partner to create value for ITC FOODS and tobacco business

Step 5 : structural implementation

Organisation structure is the frame work to which the organization operates there can be various organisational structure for the implementation of the strategy Eg-chairman and board of directors,corporate management committee and divisional CEOs are responsible with the implementation of the strategies.

Step 6 :functional implementation

it deals with the implementation of functional plans and policies that is for effective implementation of strategy, strategists have to provide direction to functional manager eg-Promotion, Advertising,Pricing

Steps 7 :behavioral implementation It deals with issues of leadership co-operate politics, use of power personal value ,business ethics and social responsibility ITCs social responsibility towards societyITC e-Choupal won the Award for the importance of its contribution to development priorities like poverty reduction, its scale and replicability, sustainability and transparency. The Company continues to sustain its unique position as the only company in the world to be carbon positive, water positive and solid waste recycling positive.

Phase 3 strategic evaluation Evaluation of strategy is that phase of strategic management process in which managers try to assure that the strategic choice is properly implemented and its meeting the objectives of the company . The strategic evaluation involves the following steps Step 1 :setting of standards The strategies need to establish performance target standards objectives strategy and implimentation plans standards needs to be define and the employees must accept it
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Eg- The company's original business was traded in tobacco. ITC stands for Imperial Tobacco Company of India Limited. The company was into the manufacturing of cigarrates earlier.

Step 2 measurement of performance The next step is to measure the actual performance both in quantitative terms and qualitative terms Cigarettes accounted for 47 per cent of the company's turnover, and that in itself is responsible for 80% of its profits of ITC.

Step 3 comparison of actual performance with standards The actual performance needs to be compared with standards to find out eviction if any It is interesting that a business that is now so involved in branding continues to use its original name, despite the negative connection of tobacco with poor health and premature death.

Step 4 finding out deviation after comparison the manager may noticed the deviation Although the ITC group is marketing its image as an ideal corporate citizen and a company that takes its social responsibility seriously, it still earns 80% of revenues from selling cigarettes and other tobacco related products.

Step 5 analyzing deviation = the deviations may be reported to higher authorities and the higher authorities must analyses the cause of deviation The cause of deviation was noted to be more dependence of the company on tobacco related products for its profits so ITC has transformed itself from a leading cigarette manufacturer to an umbrella group that offers a diversified product mix to enhance its brand image and reduce dependency on tobacco related products.

Step 6 taking corrective measure after identifying the causes of eviations,the manager needs to take the corrective steps to correct the deviation So there is an argument that ITC's move into FMCG (Fast Moving Consumer Goods)and diversify its business operations Thus the strategic management process is the complicated complex and challenging tax which involves 19steps and that can be diagrammatically represented as follows

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Recommendations: a. According to the survey conducted and after analyzing the Price, Promotion, Place and Product of the ITC and the consumer behavior in the market the company can implement the following measure for increasing the sales and volume of their products.
b. Advertisement for the Aashirvaad atta is found to be ineffective and infrequent.

So,the company can come up with an aggressive advertisement to attract the Indianhousewife as they are found to be the decision maker in the buying of Atta.
c. The company can come up the concept of forming a Retail chain of Food

products across all over India as it is follows the marketing strategy of Umbrella branding.In such retail chains all the food division products can be sold at the discounted rate, as more and more products are coming under the Umbrella products likefood processing.
d. The branded atta can be exported to other countries where we are currently

exporting the whole wheat. e. The company can approach the government or distributing their products in Military canteens and can sell them to organization that provides the afternoon meals to the children as a part of mid-day meal scheme. f. Precision analysis of products in Food Business. g. Process optimization for product development in Food Business. h. Impact of measures for reduction of energy consumption and consequent impact on the cost of production of goods.

SWOT Analysis
SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues Strengths ITC leveraged it traditional businesses to develop new brands for new segments. For example- ITC used its experience of transporting and distributing tobacco products to remote and distant parts of India to the advantage of its FMCG products. ITC master chefs from its hotel chain are often asked to develop new food concepts for its FMCG business. ITC is a diversified company trading in a number of business sectors including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery. Weaknesses

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The company's original business was traded in tobacco. ITC stands for Imperial Tobacco Company of India Limited. It is interesting that a business that is now so involved in branding continues to use its original name, despite the negative connection of tobacco with poor health and premature death. To fund its cash guzzling FMCG start-up, the company is still dependent upon its tobacco revenues. Cigarettes account for 47 per cent of the company's turnover, and that in itself is responsible for 80% of its profits. So there is an argument that ITC's move into FMCG (Fast Moving Consumer Goods) is being subsidized by its tobacco operations. Its Gold Flake tobacco brand is the largest FMCG brand in India - and this single brand alone hold 70% of the tobacco market. Opportunities Core brands such as Aashirvaad, Mint-o, Bingo! And Sun Feast (and others) can be developed using strategies of market development, product development and marketing penetration. ITC is moving into new and emerging sectors including Information Technology, supporting business solutions. e-Choupal is a community of practice that links rural Indian farmers using the Internet. This is an original and well thought of initiative that could be used in other sectors in many other parts of the world. It is also an ambitious project that has a goal of reaching 10 million farmers in 100,000 villages. ITC leverages e-Choupal in a novel way. The company researched the tastes of consumers in the North, West and East of India of atta (a popular type of wheat flour), then used the network to source and create the raw materials from farmers and then blend them for consumers under purposeful brand names such as Aashirvaad Select in the Northern market, Aashirvaad MP Chakki in the Western market and Aashirvaad in the Eastern market. This concept is tremendously difficult for competitors to emulate. Chairman Yogi Deveshwar's strategic vision is to turn his Indian conglomerate into the country's premier FMCG business. Per capita consumption of personal care products in India is the lowest in the world offering an opportunity for ITC's soaps, shampoos and fragrances under their Wills brand. Threats The obvious threat is from competition, both domestic and international. The laws of economics dictate that if competitors see that there is a solid profit to be made in an emerging consumer society that ultimately new products and services will be made available. Western companies will see India as an exciting opportunity for themselves to find new market segments for their own offerings. ITC's opportunities are likely to be opportunities for other companies as well. Therefore the dynamic of competition will alter in the medium-term. Then ITC will need to decide whether being a diversified conglomerate is the most competitive strategic formation for a secure future. ITC was incorporated on August 24, 1910 under the name of 'Imperial Tobacco Company of India Limited'. Its beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000.

Conclusion: 1. ITC promoting their brands through advertisement campaign as well as door to door promotion.
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2. ITC is also focusing on Retailers and Wholesalers to promote their brand. 3. The demand of their product in very low, because people dont know about their brands very well. 4. ITC knows their strength and weakness in the personal care market, so they are applying new concept to overcome their weaknesses. 5. ITC now offering more margins, exiting offers and long credit period to retailers and wholesalers.

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